Jervis sells $4,300 of its accounts receivable to Northem Blank in order to obtain necessary cash. Northem an chargen factoring fee What entry should Jervis make to record the transaction? Multiple Choice Debit Accounts Receivable $4,300, credit Factoring Fee Expense S86; credit Cash $4.214 Debit Accounts Receivable $4.214; debit Factoring Fee Expense $86, credit Cash $4,300. Debit Cash $4.300; credit Factoring Fee Expense $86; credit Accounts Recevable $4300
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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